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&#3950% of public aware of ISAs&#39

Commercial Union figures reveal that half the public claim to know about the Individual Savings Account.

The ISA, which will replace Peps and Tessas in April 1999, is only in the consultation phase of development but 49 per cent of people polled say they know details of the product.

The figure is slightly higher for men, with 52 per cent claiming knowledge, and is at its highest in the 45-54-year age group at 64 per cent.

General manager (life) Ian Reynolds says the recognition factor is comfortingly high, considering that the ISA does not yet exist.

But he doubts that the percentage of people who could explain exactly what an ISA is and how it will work would reach double figures.

In CU&#39s submission to the Government on ISAs, it proposes leaving existing Pep and Tessa investors with their savings rather than forcing them to transfer the accounts into the new ISA.

Reynolds believes the success of the ISA will depend on it being very simple.

CU is proposing three different ISA versions – a cash ISA, a pooled ISA, which allows investments in corporate bonds, unit trusts and life insurance policies, and an equity ISA which would allow investment in individual stocks and shares.

Perpetual is warning that the transfer of Peps to ISAs will put huge strain on IT systems and administrative capability.

Marketing director Roger Cornick believes the change means that investors must be confident that their fund managers can manage the necessary transfers.

He says: "The pressure that will be brought to bear on product providers over the six- month rollover period, from April to October 1999, will stretch administrative performance to the limit."

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